Austin, Texas’ Big Plans for What’s Now a Regional U.S. Airport

Ben Wear, Austin-American Statesman

- Jul 23, 2013 12:50 am

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Austin airport officials, riding a three-year growth streak that has passenger traffic nearing 10 million a year, have hatched plans to expand the terminal, add restaurants, shops and hotels nearby, and more than double parking over the next generation.

Those last two are likely to be done under long-term leases with private companies, plans potentially in conflict with Austin Mayor Lee Leffingwell’s push this year to lease all of Austin-Bergstrom International Airport to a private company. Leffingwell said last week that a comprehensive airport lease deal, which he hoped would help fund construction of urban rail in and near downtown, is on hold indefinitely.

“Realistically, I don’t think that can be done in the time frame we’re working with now” for a 2014 rail election, Leffingwell said. “I think it’s something to be considered for future phases of rail, or for roads.”

The airport expansion plans, however, are moving ahead rapidly. The Austin City Council on Aug. 8 is scheduled to consider a $62 million contract with Hensel Phelps Construction Co., the prime contractor when the airport was built in the late 1990s, to add 55,000 square feet to the terminal’s east side. That added space, which will fill an empty notch in the 14-year-old building just east of the Southwest Airlines ticket counters, would include a larger customs facility than exists now, more security checkpoints and added baggage handling capacity, but no new gates.

Officials said the timing of adding gates on the airport’s east end is unclear.

The council in August also will take up a proposed 40-year lease with ABIA Retail to develop a commercial hub on 13 acres west of Presidential Boulevard, an area that is home to the airport’s cellphone waiting area and undeveloped land. A rendering of what might eventually be built along Spirit of Texas Drive just south of the Airport Hilton hotel shows several restaurants, two small hotels, retail buildings and a convenience store, which would also sell gas.

The cellphone lot would remain where it is, airport spokesman Jason Zielinski said.

Under the deal, which has been on hold since 2009, when ABIA Retail was the sole bidder, the airport in the beginning would receive 40 cents a square foot for land already under development by the company. That rental amount would be adjusted every five years, city documents say, based on the growth rate of the consumer price index, Zielinski said.

The company would also pay the city 1 cent for each gallon of gasoline sold at the convenience store and a 25 percent cut of “excess net operating income,” which the city defined as the difference between operating income and costs on the properties.

That Aug. 8 agenda, until this week, also included a 30-year lease with Scott Airport Parking to build 2,000 covered parking spaces initially on vacant land between the Hilton and Texas 71. Several thousand more spaces would follow in years to come on airport-owned land north of Texas 71. The facility, which would have direct access from Presidential Boulevard and shuttles to the terminal, would also offer special services comparable with those of the privately operated parking lots along Texas 71, including car washes and oil changes.

And in what could be a concession to council members and others concerned that the airport caters almost exclusively to people owning automobiles, the lot would have bicycle parking, charging stations for electric cars and a park-and-ride lot for Capital Metro.

City documents also contemplate construction of a pet boarding facility on the Scott property.

Scott would pay the city 45 cents a square foot initially — a figure that also would be adjusted every five years — and a percentage of gross revenue that would escalate over time.

However, airport officials Wednesday decided to delay consideration of that item. Zielinski, in an email response to questions from the American-Statesman, said the airport would be coming up with a more comprehensive plan for airport expansion in the coming months, including parking. Speaking for city Aviation Department director Jim Smith, Zielinski declined to answer other questions about the parking proposal.

Expansion of parking not only would address an emerging need and competitive pressure from the private parking vendors, but also would help finance future growth at the airport such as added gates, taxiways and, Leffingwell suggested, even an additional runway.

Unlike some other sectors of city government, the airport by design and by law is a self-sufficient entity. All revenue generated there must stay there, and the city can profit from and bank revenue only from certain parts of the operation. That includes the food and other vendors in the terminal, the Hilton and the private plane terminal operators south of the airport tower, as well as parking.

“If they have the opportunity to generate revenue that could be applied toward expanding the airport, the terminal, the taxiways, that’s the way to do it, and I would be strongly in favor,” Leffingwell said. “And I believe we need more parking at the airport.”

Passenger traffic at the airport, after slumping in 2009 during the economic slowdown, has increased every year since. The airport had 9.43 million people board or land in 2012, and traffic through the first four months of 2013 is up 5 percent. May traffic was even better, with 7 percent more passengers than in May 2012. A 6 percent growth rate for the year would put traffic right at 10 million.

That would be exactly 50 percent more than the airport’s first year, 1999.

As for parking, the airport’s current capacity is 11,874, about 750 spaces below the peak demand during certain holidays and large community events such as the South by Southwest festivals, according to a consultant study done for the city in January. The report said that the off-site operators, the Parking Spot and Airport Fast Park, had another 4,900 spaces at that point and that Fast Park had broken ground on a 3,600-space addition.

The city is already expanding parking capacity under a deal with the airport’s rental car companies. Upon completion of a garage under construction just north of the existing garage, as well as two surface lots that the airport is funding, public parking capacity will increase by about 4,000 spaces.